Netflix Inc. will require customers in five Latin American countries to pay an extra fee if they want to use their account at an address other than the main one, a trial that the company hopes will generate additional revenue by making customers pay to share their Netflix account.
(Netflix loses a million subscribers in the second quarter).
to customers in Argentina, El Salvador, Guatemala, Honduras and the Dominican Republic They will be required to pay an additional fee if they use an account for more than two weeks outside of their primary residence, the company said Monday. in a blog post.
This will not affect the use of Netflix on mobile devices such as smartphones, tablets or laptops, nor will it affect people who are on vacation. The additional house will have a charge of 219 pesos (US$1.70) in Argentina and US$2.99 in other countries.
(Netflix and Microsoft will launch subscription model with ads).
Netflix has said that more than 100 million households are using accounts paid for by others, and I blame password sharing as one of the main reasons for their lack of subscriber growth. The company had a reduction of 200,000 clients in the first quarter and forecast that it would lose 2 million more in the second.
Its share price has fallen more than 65% this year. as investors fear the streaming company’s business is in trouble. “Widespread account sharing between households undermines our long-term ability to invest and improve our service,” Chengyi Long, director of production innovation, said in the blog.
Password sharing has been particularly high in Latin America, where
Netflix is running its first two tests to see if people will pay for additional access. The company is trying to limit sharing without punishing people who already pay for Netflix or alienating viewers.
The effort has sometimes been portrayed as a crackdown, causing some customers to worry that they will lose access to their account. The company is testing ways to charge extra if people want to use the same account.
Netflix.
In its first effort, the company required customers in Chile, Costa Rica, and Peru to pay an additional fee to add a member to an account. That new member sets up a subaccount with their own email address and can use Netflix at the same time as the account holder within the limits of their plan.
A basic plan allows customers to use only one device at a time. The more expensive standard plan allows for two separate devices, and the premium plan allows for four.
This last test is aimed at customers who use the same account in several households. If they use an account somewhere other than one of their paying households for more than two weeks, they will receive an in-app notification prompting them to add an additional household or move their primary household to the new location.
Customers can manage their homes, add or delete them as they wish. Adding households does not increase the number of people who can watch Netflix at the same time.
BLOOMBERG
